Canuck in Boston Posted March 21, 2006 Share Posted March 21, 2006 Investors buying into the idea of this American league By Frank Dell'Apa, Globe Staff | March 21, 2006 Investors in sporting enterprises could do much worse than to follow the trail of Philip Anschutz, Lamar Hunt, and Bob Kraft. Anschutz and Hunt were already ahead of the curve in the late 1960s, Anschutz combining oil and gas drilling with media, Hunt pushing the envelope on sports investment, practically inventing the Super Bowl, buying into the Chicago Bulls when Michael Jordan was still in grade school, establishing professional soccer in the Midwest. The Kraft family followed the Hunt blueprint, becoming an avatar of the 21st century sports entrepreneur. Convergence occurred during the 1994 World Cup. Hunt had been attending World Cups as a superfan since 1966. The Krafts purchased Foxboro Stadium and had it made into a World Cup venue. And Anschutz became so enamored with soccer during the Cup that he became Major League Soccer's biggest investor. They ponied up $5 million per team, spare change for them and other original investors. The league's revenue-sharing plan meant they lost equal amounts of money for several years. They also had to prop up problem teams, Anschutz at one time controlling half the MLS teams. But now, the league appears to be turning the corner, and in the last two years, new investors have radically changed the face of the MLS. The addition of Red Bull Company Ltd., which purchased the MetroStars this month, is the most lucrative deal in MLS history. The Austrian company is investing more than $100 million to purchase the team and stadium naming rights plus half-ownership in the proposed $92 million Red Bull Park in Harrison, N.J. The MLS profile has been changing rapidly after appearing to stagnate with 10 teams and three principal owners in 2003. The Miami Fusion and Tampa Bay Mutiny had folded, and recession worries eliminated Metromedia. Then: Kroenke Sports Enterprises (Denver Nuggets, Pepsi Center) took over the Colorado Rapids for the 2004 season; In 2005, Mexico's most popular club, Chivas, expanded to Los Angeles, potentially capturing much of the Mexican-American market, and Dave Checketts decided Salt Lake City needed soccer, naming the team after Real Madrid; After the '05 season, Maple Leaf Entertainment was awarded a team in Toronto; the San Jose Earthquakes moved to Houston; first as Houston 1836, then as the Houston Dynamo; the MetroStars became Red Bull New York; and, yesterday, Glassboro, N.J., announced it will build an MLS stadium, potentially adding the Philadelphia-South Jersey market. Stadia have been catalysts for investment. Again, Hunt started the trend by constructing Crew Stadium in Columbus in 1999. The Home Depot Center followed in Carson, Calif., Last year, Pizza Hut Park opened in Frisco, Texas. The Chicago Fire will play in a new stadium in Bridgeview, Ill., this summer. The Colorado Rapids are to move into a Commerce City facility next year. Work on Red Bull Park is to start in August. Toronto has committed to a new stadium and Salt Lake City appears next. None of these are mega-constructions, so they are not mega-risks. The MLS model is scaled to 20,000-30,000 capacity buildings. Hunt and Anschutz funded the first of these, but now municipalities are willing to contribute. Red Bull has moved quickly to rebrand the MetroStars. ''Everything we do is about marketing. Red Bull must be synonymous with energy, strength, and endurance, but also with spirit and creativity," Red Bull CEO Dietrich Mateschitz told the Austrian economic weekly Format. ''We are always in discussions with international investors of all types, but this is the most serious because they have actually invested," MLS president Mark Abbot said yesterday. ''A lot of it is a testament to Red Bull's vision into professional soccer in the US and how they can be involved. ''Red Bull shares a lot of our attributes. It is a relatively young company, they appeal to a broad spectrum of society and are very much into associating with an active lifestyle, as we are. ''They are looking at soccer in the US and seeing how far it has come and what it's continuing potential is." Link to comment Share on other sites More sharing options...
This topic is now archived and is closed to further replies.